Becoming a homeowner is not always the easiest task. To be honest, at one point owning our home seemed like a completely far-fetched dream. Never did we imagine that we would be able to repair our finances and start accomplishing our financial goals. We thought it was impossible, partly because of our own misconceptions about what is required to own a home.
If I can say one thing, it’s to really get educated on obtaining a mortgage. This will save you the pain and possible mistakes that may arise during your loan process.
With our own experience in mind, I’m excited to partner with Bank of America to share their Community Homeownership Commitment. I know that if we knew about educational tools like the First-Time Homebuyer Online Edu-Series and their down payment and closing cost grants that we could have probably purchased a home sooner than we did. Bank of America is here to help get you in a home that you love, so don’t hesitate to utilize their services.
For me, it’s important that we share what we have learned in hopes of making one of your journeys that much easier.
First, let me share some of the mistakes we made before owning a home.
1. We waited to reach out to a mortgage company until our finances were perfect.
I strongly recommend reaching out to your bank or financial institution when you are serious about purchasing a home. Often they will have at least some of your financial information already, plus some offer rewards to existing clients. They will review your financial situation and help you identify what your areas of weakness are and what can be improved. Once we finally talked with a specialist, they expressed to us what exactly had to happen next. Speaking with a specialist will give you a clear picture of what is needed to cross the finish line to homeownership. I recommend reaching out to them, to allow you to get a plan in place. Also, to that point, there were aspects I thought would be issues that weren’t issues at all.
2. We were only factoring our down payment into our decision:
Y’all, prior to getting a house I just factored in that you have to put a percentage of the purchase price down on a home. Boy, was I wrong. You also have closing costs and other expenses. When you are working with your mortgage specialist, they’ll provide you with an estimate of how much cash you’ll need to close. This will help you plan. Word of advice, always have extra saved if possible because you never know what will happen. I know saving can take time, but I strongly recommend going into buying a home with more than what you need. Check out Life Plan® from Bank of America, an easy way to set and track short- and long-term financial goals and get personalized advice when you need it most.
Another important factor to remember is, you do not need to take out a loan for the full amount of what you were pre-approved for. Find an amount that you’re comfortable with. It has always been important to me that we not be house poor. I wanted to still be able to live. I encourage you to really look at your finances and budget. Set a price range that allows you to live comfortably and still hit other financial goals.
I wanted to give encouragement to anyone that is getting ready to apply for a mortgage. Know that it is not always fun. Yes, you will have to provide a lot of data, but push through, because there will be a light at the end of the tunnel.
After going through the application process, I learned being on top of your finances is everything. I am not saying you have to be completely debt free. However, you want everything buttoned up. Nothing that hasn’t been handled. Get your financial affairs in order because that can delay your loan processing and make it more difficult.
If you think that owning a home is impossible, please know that if I can do it, you can do it. With Bank of America’s Community Homeownership Commitment®, owning a home may be more attainable than you might think. Their Community Homeownership Commitment includes grants that don’t require repayment and mortgages that require as little as a 3% down payment.
They have two home grant programs, one to help with down payments and the other for closing costs. And, their low down payment loans have fixed interest rates, which means your monthly principal and interest payment is the same each month for the term of your loan.
If you’re looking to become a homeowner, make sure to use the resources and tools that are available.
*This blog post is in partnership with Bank of America. All thoughts and opinions are my own.
Bank of America, N.A. Equal Housing Lender. Credit and collateral are subject to approval. Terms and conditions apply.